Is there really an oil shortage?

Who own the most oil fields? The answer probably won't surprise you - the world's governments. And they do a lousy job of managing them.

Socialist oil death spiral
Richard W. Rahn
November 6, 2007

Socialism always plants the seeds of its own destruction, and state-owned oil is no exception. Most people do not realize that about 90 percent of the world's liquid oil reserves are controlled by governments or state-owned companies. Exxon Mobil, the world's largest privately owned oil company, owns only 1.08 percent of the world's oil reserves, and the five largest private global oil companies together own only about 4 percent of the world's oil reserves.

There is enough liquid oil in the ground to last generations; and when oil sands and oil shale are included, there is enough oil to last centuries. If there were a truly free market in oil, with both the reserves and production owned and controlled by many competitive companies, the price of oil would be a fraction of today's price.

Imagine that, centuries of oil, a fraction of today's cost. Who would have thought!